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Ascend Consultancy Weekly Team Perspective: Boeing 737 Production Rates – What do they mean for 2024 Deliveries?

There now seems to be significant downside risk to the delivery hypothesis.

Aircraft Appraiser of the Year


By Rob Morris, Global head of consultancy, Cirium Ascend

At the recent Bank of America Global Industrials conference in London on 20 March Boeing’s CFO Brian West was non-specific about the current 737 production rate but did note that previously the company did get to ‘low- to mid-30s’ per month. Cirium fleet data illustrates this via the chart below, which tracks first flights from both Boeing and Airbus’s key single-aisle production lines. However, it also clearly shows that Boeing achieved only 19 and 11 first flights in January and February respectively, well below the ‘low- to mid-30s’ that we can see was achieved between February and July last year when we saw a monthly average close to 36 aircraft. Since that time we have seen a clear downward trajectory and now production sits around ‘low- to mid-teens’.

What does this mean for 2024 deliveries? At present, Cirium Ascend’s working hypothesis is for 500 737 Max deliveries this year. A few weeks ago that did feel like a robust assumption, but there now seems to be significant downside risk to this hypothesis.

To date (as I write on 22 March), Cirium’s data records 58 737 deliveries in 2024, including one 737-800 based P-8 which is excluded from the analysis (but is included in the first flight data above). Hence, as we approach end of the quarter only 57 737 Max in that total. The same data indicates that Boeing have 167 Max in inventory – aircraft which have flown but not yet delivered – but this total includes 27 737-7 Max and 6 737-10 Max which almost certainly will not be delivered to customers in 2024 as neither variant has yet been certificated by FAA. Hence, the maximum we can assume will be delivered from inventory is 130 737-8 Max and 4 737-9 Max. Add those to the year-to-date total and we achieve 191 deliveries.

This means that Boeing will need to fly and deliver a further 309 aircraft to achieve our current hypothesis of 500 deliveries.

Applying simple arithmetic, that would mean more than 34 new-build aircraft per month if we assume that Boeing is able to ramp back up to its ‘low- to mid-30s’ next month. However, this seems an unlikely scenario. Perhaps more likely to assume that it will take up to three months before Boeing can fix its issues and start to increase production back towards those mid-2023 levels again.

In this scenario, if we assume that production remains around today’s levels through June, then ramp back towards the ‘low- to mid-30s’ by September, the resulting additional new-build aircraft in 2024 is around 250 units. Adding those to the current total and estimated future deliveries from inventory results in a total 2024 delivery estimate of around 440 aircraft.

There is one potential bright spot that mitigates this risk marginally. In Boeing’s Q4 earnings call on 29 January, CEO Dave Calhoun noted “there are around 25 airplanes produced in 2023 that are still WIP (work in progress)”. If these aircraft have not yet flown then they could be candidates to be completed and delivered this year, to some extent reducing that downside risk (albeit we don’t know what variant these are).

Hence, the downside risk to our existing hypothesis of 500 737 Max deliveries in 2024 is around 40-60 aircraft.

We are already hearing airlines speak of expected delivery shortfalls this year, which continues to exacerbate regional and global capacity shortages. Boeing’s production woes on the 737 need to be fixed quickly if this ‘crisis’ isn’t to continue for a long while yet.


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